1 Unless otherwise indicated, all subsequent section

(continued...)

T.C. Memo. 2010-51

UNITED STATES TAX COURT

LARRY DELANO COLEMAN, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 4740-09L. Filed March 18, 2010.

Larry Delano Coleman, pro se.

Dennis R. Onnen, for respondent.

MEMORANDUM OPINION

ARMEN, Special Trial Judge: The instant proceeding arises

from a petition for judicial review filed in response to a Notice

Of Determination Concerning Collection Actions(s) Under Section

6320 and/or 6330.1 The issue for decision is whether respondent
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1(...continued)

references are to the Internal Revenue Code and all Rule

references are to the Tax Court Rules of Practice and Procedure.

may proceed with the collection action as so determined. Pending

before the Court are: (1) Respondent’s Motion For Summary

Judgment, filed September 18, 2009, and (2) petitioner’s crossMotion For Summary Judgment, filed November 4, 2009.

Background

Petitioner resided in the State of Missouri when the

petition was filed.

Petitioner’s Tax Liabilities for 1999, 2004, 2005, and 2006

Petitioner filed Federal income tax returns for 2004, 2005,

and 2006 on April 2, April 1, and December 31, 2007,

respectively, but failed to fully pay the liabilities reflected

thereon. In addition, a trust fund recovery penalty (TFRP) was

assessed against petitioner pursuant to section 6672 for the

period ending December 31, 1999, with respect to unpaid

liabilities of Larry Delano Coleman, PC, petitioner’s former

legal practice.

Final Notices of Intent To Levy and Notice of Federal Tax Lien

On January 4, 2008, respondent sent petitioner a Final

Notice Of Intent To Levy And Notice Of Your Right To A Hearing

with regard to the proposed levy to collect his income tax

liabilities for tax years 2004 and 2005 and the TFRP. Petitioner

submitted a Form 12153, Request For A Collection Due Process Or
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2 The Court notes that on the Form 12153 dated Jan. 5,

2008, petitioner marked the box next to “Innocent Spouse Relief”. 

The request for innocent spouse relief was made on behalf of

petitioner’s wife, who is not a party to the present action.

Equivalent Hearing, dated January 5, 2008, but received by

respondent on March 10, 2008.

On July 16, 2008, respondent sent petitioner a Final Notice

--Notice Of Intent To Levy And Notice Of Your Right To A Hearing

with regard to a proposed levy to collect petitioner’s income tax

liability for 2006. Petitioner submitted a Form 12153 dated

August 15, 2008.

On July 29, 2008, respondent sent petitioner a Notice Of

Federal Tax Lien Filing And Your Right To A Hearing Under IRC

6320 with regard to petitioner’s income tax liabilities for 2004,

2005, and 2006. Petitioner submitted a Form 12153 dated August

15, 2008.

On each of the Forms 12153 petitioner indicated that he

wished to pursue a collection alternative; namely, an installment

agreement or offer-in-compromise.2 In addition, on the Form

12153 dated January 5, 2008, petitioner wrote “Taxpayer Advocate

Service” next to “Other”.

Administrative Developments

Petitioner’s collection case for each of the foregoing

periods was assigned to Settlement Officer Deborah Landers (Ms.

Landers) of the IRS Office of Appeals in Kansas City, Kansas. In
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a letter to petitioner dated September 2, 2008, Ms. Landers

scheduled a telephone conference for October 7, 2008. In

addition, Ms. Landers stated that in order for her to consider a

collection alternative, petitioner was required to make estimated

tax payments for 2008, submit a Form 433-A, Collection

Information Statement for Wage Earners and Self-Employed

Individuals, and file an income tax return for 2007.

In a letter dated September 5, 2008, petitioner requested

that his collection case be assigned to a different settlement

officer, as Ms. Landers had previously been involved in the TFRP

for 1999. Thereafter petitioner’s collection case was assigned

to settlement officer Keith R. Cummings (Mr. Cummings), also of

the IRS Office of Appeals in Kansas City, Kansas. In a letter to

petitioner dated October 3, 2008, Mr. Cummings scheduled a

telephone conference for October 17, 2008. In addition, Mr.

Cummings indicated that in order for a collection alternative to

be considered, petitioner was required to submit a Form 433-A and

a copy of his 2007 income tax return, which was due to be filed

on October 15, 2008.

Petitioner did not submit a Form 433-A or a copy of his 2007

tax return before the scheduled conference call. On October 17,

2008, petitioner and Mr. Cummings held a telephone conference. 

During the conference petitioner conceded that he owed the income

taxes. Petitioner questioned the origin of the TFRP, and Mr.
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3 Mr. Cummings’ contemporaneous notes of the telephone

conference state the following:

Underlying liability issues? No -- taxpayer was not audited

on CDP years at issue, concedes that he owes these taxes. 

Had questions regarding trust fund recovery penalty. 

Explained IRC 6672 -- had to do with unpaid payroll taxes

for his prior law practice. Taxpayer was unaware of this --

thought it had something to do w/income taxes. Said he

didn’t pick up the letters for 1153 TFRP letter because he

didn’t know what they were for. He explained that old biz

(law practice) that was the basis for unpaid payroll taxes

was his practice - - he admitted that he would be

responsible for the TF taxes, as there was no one else to

blame. Asked for payoff of TFRP. Gave today’s payoff.

Cummings explained that the TFRP was based on petitioner’s unpaid

payroll taxes for his legal business; petitioner thereafter

admitted he was responsible for the unpaid taxes and requested

the payoff amount.3 During the conference petitioner requested

additional time to complete the Form 433-A, which Mr. Cummings

denied on the basis that petitioner had already been given

sufficient time to complete the Form 433-A. Petitioner also

mentioned that he would like to submit an offer-in-compromise but

would not have time to do so until November. Petitioner never

mentioned Taxpayer Advocate assistance.

On February 2, 2009, respondent issued petitioner a Notice

Of Determination Concerning Collection Action(s) Under Section

6320 and/or 6330 sustaining respondent’s proposed collection

actions for the income tax liabilities for 2004, 2005, and 2006,

and for the TFRP for 1999. The notice states that
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4 Any other arguments in petitioner’s objection are

unpersuasive and without foundation. See Crain v. Commissioner,

737 F.2d 1417, 1417 (5th Cir. 1984) (“We perceive no need to

refute these arguments with somber reasoning and copious citation

of precedent; to do so might suggest that these arguments have

(continued...)

[petitioner has] been granted installment agreements in

the past by the Service dating back to 1998. These

agreements have defaulted on a somewhat regular basis

due to [petitioner’s] failure to make the agreed upon

payments, or the filing of subsequent Federal income

tax returns with new tax liabilities.

On February 27, 2009, petitioner filed the petition in this

case. In the petition he stated his reasons for disagreeing with

the notice of determination, as relevant herein, are:

(1) Civil penalty for 1999 was for a professional

corporation that did not exist in 1999.

* * * * * * *

(3) IRS will not enable installment agreement or

settlement, given difficult economic times.

Motions for Summary Judgment

As stated above, respondent filed the Motion For Summary

Judgment on September 18, 2009. In his motion respondent argues

that the settlement officer did not abuse his discretion in

sustaining respondent’s proposed collection action when he

refused to consider a collection alternative.

Petitioner’s Objection To Respondent’s Motion For Summary

Judgment was filed on October 23, 2009. In his objection

petitioner appears to contest the validity of the underlying

liability.4 Petitioner subsequently filed a cross Motion For
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4(...continued)

some colorable merit.”).

Summary Judgment on November 4, 2009. In his cross-motion

petitioner alleges that the TFRP was wrongfully assessed because

Larry Delano Coleman, PC, did not exist in 1999. Petitioner also

requested a refund of all payments made on a payment plan.

Respondent filed an Objection to petitioner’s cross-motion

for summary judgment on December 8, 2009. In his objection

respondent argues that petitioner is precluded from challenging

the underlying tax liability for the TFRP because petitioner did

not raise this issue during the administrative hearing. In 

addition, respondent argues that the Court lacks jurisdiction to

order a refund in an action based upon a notice of determination.

Discussion

A. Summary Judgment

Summary judgment is intended to expedite litigation and

avoid unnecessary and expensive trials. Fla. Peach Corp. v.

Commissioner, 90 T.C. 678, 681 (1988). Summary judgment may be

granted with respect to all or any part of the legal issues in

controversy “if the pleadings, answers to interrogatories,

depositions, admissions, and any other acceptable materials,

together with the affidavits, if any, show that there is no

genuine issue as to any material fact and that a decision may be

rendered as a matter of law.” Rule 121(a) and (b).
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After carefully reviewing the record, we are satisfied that

there is no genuine issue as to any material fact, and a decision

may be rendered as a matter of law. Accordingly, we shall grant

respondent’s motion for summary judgment and deny petitioner’s

cross-motion for summary judgment.

B. Respondent’s Proposed Collection Actions

Section 6330 generally provides that the Commissioner cannot

proceed with collection by levy until the taxpayer has been given

notice and the opportunity for an administrative review of the

matter (in the form of an Appeals Office hearing) and, if

dissatisfied, the taxpayer may seek judicial review of the

administrative determination. See Davis v. Commissioner, 115

T.C. 35, 37 (2000); Goza v. Commissioner, 114 T.C. 176, 179

(2000).

Section 6330(c) prescribes the matters that a taxpayer may

raise at an Appeals Office hearing. In sum, section 6330(c)

provides that a taxpayer may raise collection issues such as

spousal defenses, the appropriateness of the Commissioner’s

intended collection action, and possible alternative means of

collection. Section 6330(c)(2)(B) provides that the existence

and amount of the underlying tax liability may be contested at an

Appeals Office hearing only if the person did not receive a

notice of deficiency for the tax in question or did not otherwise

have an opportunity to dispute the tax liability. See Sego v.
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Commissioner, 114 T.C. 604, 609 (2000); Goza v. Commissioner,

supra at 180-181. When the underlying tax liability was not

properly raised during the Appeals Office hearing, the taxpayer

may not raise the underlying tax liability on appeal of a notice

of determination. Giamelli v. Commissioner, 129 T.C. 107, 115

(2007). As made manifest by the settlement officer’s

contemporaneous notes of the Appeals conference, see supra note

3, petitioner did not challenge the existence or amount of the

underlying TFRP. Petitioner for the first time challenged his

underlying tax liability for the TFRP in his petition;

accordingly, this Court does not consider that issue.

Where the validity of the underlying tax liability is not

properly at issue, the Court will review the Commissioner's

administrative determination for abuse of discretion. Goza v.

Commissioner, supra at 181-182. The Court has described the

abuse of discretion standard as meaning “arbitrary, capricious,

or without sound basis in fact or law.” Giamelli v.

Commissioner, supra at 111 (citing Woodral v. Commissioner, 112

T.C. 19, 23 (1999)). In reviewing for abuse of discretion, we

generally consider “only arguments, issues, and other matter that

were raised at the collection hearing or otherwise brought to the

attention of the Appeals Office.” Magana v. Commissioner, 118

T.C. 488, 493 (2002); cf. Hoyle v. Commissioner, 131 T.C. 197

(2008) (an Appeals officer must verify compliance with applicable
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5 The notice of determination indicates that petitioner’s

2007 Federal income tax return was filed delinquently in November

2008. This return shows an amount due as a result of

petitioner’s failure to have income tax withheld from his

paychecks and his failure to make quarterly estimated tax

payments. Respondent assessed tax, penalty, and statutory

interest.

law under section 6330(c)(1) regardless of whether the taxpayer

raised the issue at the Appeals hearing). Any issue not raised

is now deemed to be conceded. See Rule 331(b)(4) (“Any issue not

raised in the assignments of error shall be deemed to be

conceded.”). Although special circumstances might cause us to

depart from this approach, we are unable to discern any such

circumstances in the present case.

Petitioner participated in a telephonic hearing on October

17, 2008. During the hearing petitioner wanted to discuss the

possibility of entering into an installment agreement. However,

petitioner had not submitted financial information and, at that

time, petitioner had not filed a tax return for 2007.5 This

Court has consistently held, as have other courts, that a

determination that a taxpayer is not entitled to a collection

alternative does not constitute an abuse of discretion if the

taxpayer did not provide financial information during the

administrative hearing and was not currently in compliance with

Federal tax laws, i.e., had not filed all required tax returns. 

E.g., Olsen v. United States, 414 F.3d 144 (1st Cir. 2005) (no

abuse of discretion in rejecting an offer-in-compromise when the
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taxpayer failed to provide financial information during the

administrative hearing); Willis v. Commissioner, T.C. Memo. 2003-

302 (no abuse of discretion because taxpayer failed to provide

sufficient financial documentation); Moorhous v. Commissioner,

T.C. Memo. 2003-183 (no abuse of discretion because current

financial information was not provided by the taxpayer during the

administrative hearing); cf. Vinatieri v. Commissioner, 133 T.C.

__ (2009) (release of levy required despite noncompliance with

filing required returns when Commissioner acknowledged that

taxpayer had demonstrated financial hardship).

Furthermore, the settlement officer’s refusal to grant

additional time to complete the financial information was not an

abuse of discretion, as his approach was not inconsistent with

IRS guidelines. See Dinino v. Commissioner, T.C. Memo. 2009-284. 

“There is no requirement that the Commissioner wait a certain

amount of time before making a determination as to a proposed

[collection procedure]”. Gazi v. Commissioner, T.C. Memo. 2007-

342. “Appeals will, however, attempt to conduct a CDP hearing

and issue a Notice of Determination as expeditiously as possible

under the circumstances.” Sec. 301.6330-1(e)(3), Q&A-E9, Proced.

& Admin. Regs. Both the letter from Ms. Landers dated September

2, 2008, and the letter from Mr. Cummings dated October 3, 2008,

requested that petitioner submit financial information so that a

collection alternative could be considered.
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In addition, petitioner received a de facto extension of

time, as it is the policy of the Appeals Office to consider

financial information submitted past the deadline and up to the

time of the issuance of the notice of determination. See Dinino

v. Commissioner, supra; 4 Administration, Internal Revenue Manual

(CCH) pt. 8.22.2.2.4.11(1)(c), at 27,997-373 (Oct. 30, 2007). 

Thus, petitioner had until the notice of determination was issued

on February 2, 2009, i.e., more than 15 weeks after his request

for more time during the administrative hearing on October 17,

2009.

We conclude that there are no genuine issues of material

fact for trial and that respondent’s determination to proceed

with collection was not an abuse of discretion.

Conclusion

Finally, in reaching the conclusions described herein, we

have considered all arguments made by petitioner, and, to the

extent not mentioned above, we find them to be moot, irrelevant,

or without merit.
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To reflect the foregoing,

An appropriate order and

decision will be entered

granting respondent’s motion

for summary judgment and

denying petitioner’s crossmotion for summary judgment.